The Uppity Sheikdom May Not Survive A Conflict With Its Neighbors – Moon of Alabama
April 29, 2026
The Uppity Sheikdom May Not Survive A Conflict With Its Neighbors
Yesterday the United Arab Emirates (UAE) declared that it would leave the Organization of the Petroleum Exporting Countries (OPEC). It is a divorce that will likely have severe consequences for the UAE’s well being.
This is a long term move that has been long coming and independent from the short term consequences of current USrael war on Iran.
With the UAE leaving OPEC will consist of 11 core members: Algeria, Congo, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia and Venezuela. OPEC+ additionally includes Russia, Azerbaijan, Kazakhstan, Bahrain, Brunei, Malaysia, Mexico, Oman, South Sudan, and Sudan.
The UAE decision is a victory for the U.S. and its oil industry. As a WSJ opinion piece asserts:
U.S. shale fracking has achieved Washington’s longtime strategic goal of curbing the Organization of the Petroleum Exporting Countries’s control over oil prices. The cartel is fracturing, with the United Arab Emirates announcing its exit on Tuesday. This is another foreign policy victory for American fossil-fuel energy.
The U.A.E. has chafed for years at OPEC’s per-country production quotas that are intended to limit global supply and push up oil prices. Saudi Arabia and the U.A.E. are the cartel’s two swing producers that have excess capacity to ramp up output, with Abu Dhabi capable of producing 1.4 million barrels a day more than OPEC’s quota.
Abu Dhabi is rich and has large financial reserves. It does not need a higher oil output to survive.
The reasons for its divorce from other Arab oil producers are deeper (archived) than bore holes:
In recent years, Emirati officials have spoken of the importance of pursuing their own economic interests, chafing at quotas set by OPEC that curtailed their oil production.
They have deepened their alliance with Israel, while other Arab governments keep their distance or pull further away from it.
In Yemen, the Emirates has supported an armed insurgency, angering Saudi leaders, who back the government there.
And in Sudan’s brutal civil war, where Saudi Arabia and Egypt support the government, the Emirates has backed a rival paramilitary group. Emirati officials have denied sending weapons to the Sudanese group, the Rapid Support Forces, despite extensive evidence to the contrary.
The rift between Saudi Arabia and the Emirates that has been developing for years and extends to the highest levels of the two governments.
Prince Mohammed of Saudi Arabia and the Emirati leader, Sheikh Mohammed bin Zayed, were once close partners, joining forces in 2015 to fight the Houthi rebels in Yemen, but they have since diverged significantly, pursuing different visions for the future of the Middle East that have come into conflict with one another. That rupture burst into public view in December, but appears to have hardened during the war with Iran.
…
As Gulf Arab officials weigh how to respond to Iran, the Emirates has taken measures to sever its longstanding cultural and economic ties with the country. Saudi Arabia, which has faced fewer and less damaging attacks, has condemned Iran strongly, but has supported efforts led by Pakistan to find a diplomatic resolution to the war — an initiative from which the Emirates has kept some distance.Emirati officials have spoken repeatedly of their dissatisfaction with Arab and Islamic multilateral organizations, hinting that they would have preferred a stronger stance against Iran.
…
For years, the Emirates had remained in OPEC “out of deference to Saudi Arabia,” Ms. Diwan said. Tuesday’s news makes it clear that “they will no longer defer to Saudi leadership.”
And therein lies a problem …
The UAE has some 10 million inhabitants of which only 12% are born Emiraties. The rest are Indian, Pakistani and other guest workers who could leave at any moments notice.
Saudi Arabia has 33 million inhabitants.
Going against several major policies of its big neighbor is a high risk endeavor . While the UAE can in general hope for support from Israel and the U.S. its is highly unlikely that either would intervene should Saudi Arabia (with Pakistani and/or Egyptian support) decide to get rid of an uppity sheik in its immediate neighborhood. It probably would not be a short or easy conflict but their would not be much left of the UAE should the Saudis proceed. The rest of OPEC and OPEC+ would likely stand by and applause.
As Yves Smith at Naked Capitalism comments:
With no shipments out of the Gulf now, this move has no immediate effect. The UAE apparently wants to pump freely when it can. But that also assumes that there will be a UAE when the conflict ends.